Sonic Automotive, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Per Share Data and Stockholders' Equity

Per Share Data and Stockholders' Equity

9 Months Ended

Sep. 30, 2011

Per Share Data and Stockholders' Equity [Abstract]

7. Per Share Data and Stockholders’ Equity

The calculation of diluted earnings per share considers the potential dilutive effect of Sonic’s contingently convertible debt issuances and stock options to purchase shares of Class A common stock under several equity compensation plans. The following table illustrates the dilutive effect of such items on earnings per share for the third quarter and nine-month periods ended September 30, 2011 and 2010:


	For the Third Quarter Ended September 30, 2011
			Income From Continuing Operations				Income From Discontinued Operations				Net Income

	Weighted Average Shares		Amount		Per Share Amount		Amount		Per Share Amount		Amount		Per Share Amount
	(In thousands, except per share amounts)
Earnings and shares		52,366	$	19,333			$	68			$	19,401
Effect of participating securities:
Non-vested restricted stock and stock units		—		(253)				—				(253)

Basic earnings and shares		52,366	$	19,080	$	0.36	$	68	$	0.01	$	19,148	$	0.37
Effect of dilutive securities:
Contingently convertible debt ( 5.0% Convertible Notes)		12,590		2,366				—				2,366
Stock compensation plans		561

Diluted earnings and shares		65,517	$	21,446	$	0.33	$	68	$	—	$	21,514	$	0.33


	For the Third Quarter Ended September 30, 2010
			Income From Continuing Operations				Loss From Discontinued Operations				Net Income

	Weighted Average Shares		Amount		Per Share Amount		Amount		Per Share Amount		Amount		Per Share Amount
	(In thousands, except per share amounts)
Earnings (loss) and shares		52,311	$	13,949			$	(964)			$	12,985
Effect of participating securities:
Non-vested restricted stock and stock units		—		(137)				—				(137)

Basic earnings (loss) and shares		52,311	$	13,812	$	0.26	$	(964)	$	(0.01)	$	12,848	$	0.25
Effect of dilutive securities:
Contingently convertible debt ( 5.0% Convertible Notes)		12,890		2,498				16				2,514
Stock compensation plans		650

Diluted earnings (loss) and shares		65,851	$	16,310	$	0.25	$	(948)	$	(0.02)	$	15,362	$	0.23


	For the Nine Months Ended September 30, 2011
			Income From Continuing Operations				Loss From Discontinued Operations				Net Income
	Weighted Average Shares		Amount		Per Share Amount		Amount		Per Share Amount		Amount		Per Share Amount
	(In thousands, except per share amounts)
Earnings (loss) and shares		52,414	$	57,275			$	(1,559)			$	55,716
Effect of participating securities:
Non-vested restricted stock and stock units		—		(744)				—				(744)

Basic earnings (loss) and shares		52,414	$	56,531	$	1.08	$	(1,559)	$	(0.03)	$	54,972	$	1.05
Effect of dilutive securities:
Contingently convertible debt ( 5.0% Convertible Notes)		12,789		6,970				—				6,970
Stock compensation plans		597

Diluted earnings (loss) and shares		65,800	$	63,501	$	0.97	$	(1,559)	$	(0.03)	$	61,942	$	0.94


	For the Nine Months Ended September 30, 2010
			Income From Continuing Operations				Loss From Discontinued Operations				Net Income
	Weighted Average Shares		Amount		Per Share Amount		Amount		Per Share Amount		Amount		Per Share Amount
	(In thousands, except per share amounts)
Earnings (loss) and shares		52,151	$	30,107			$	(4,532)			$	25,575
Effect of participating securities:
Non-vested restricted stock and stock units		—		(295)				—				(295)

Basic earnings (loss) and shares		52,151	$	29,812	$	0.57	$	(4,532)	$	(0.09)	$	25,280	$	0.48
Effect of dilutive securities:
Contingently convertible debt ( 5.0% Convertible Notes)		12,890		6,709				28				6,737
Stock compensation plans		670

Diluted earnings (loss) and shares		65,711	$	36,521	$	0.56	$	(4,504)	$	(0.07)	$	32,017	$	0.49

In addition to the stock options included in the table above, options to purchase approximately 2.1 million shares and 2.3 million shares of Class A common stock were outstanding at September 30, 2011 and September 30, 2010, respectively, but were not included in the computation of diluted earnings per share because the options were not dilutive. In addition, in the event the effect of potentially dilutive shares associated with any of Sonic’s convertible notes were anti-dilutive, the effect of those shares have also been excluded from the computation of diluted earnings per share.